Senate Committee recommends Cabinet threshold for PBS approvals be increased

The Senate Community Affairs Committee has recommended that the threshold for Federal Cabinet approval for listing new medicines on the Pharmaceutical Benefits Scheme be increased.

In its report released last night, the Committee recommended that the threshold should be immediately increased from its current $10 million to a level reflecting its original 2001 value and that the threshold should be indexed annually to maintain its real value.

“This is a major step forward and will make a big difference to Australian patients if the Government sees the wisdom in implementing it,” said Dr Brendan Shaw, Chief Executive.

“It’s time for the Government to implement this sensible reform to the PBS.”

“We now have both the Productivity Commission and a key Senate Committee recommending to Government that the current $10 million Cabinet threshold be increased and indexed.”

“The fact that the Senate Committee has unanimously recommended this across party lines is particularly significant.”

“We know that the time it takes for Cabinet to approve a new medicine to be listed on the PBS has increased from 6.7 months to 10 months. That’s an additional 10 months after the medicine has been reviewed by a variety of expert bodies for its cost-effectiveness, and it’s an additional 10 months that patients have to wait for new therapies.”

“It makes no sense that patients are being made to wait an additional 10 months for sometimes life-saving treatments by a bureaucratic process whose rationale is unclear at best, when those medicines have already been rigorously evaluated.”

“There are some medicines that simply should not have to grind through the Cabinet process and the Senate Committee has recognised this.”

“Increasing the threshold and indexing it will get subsidised new medicines to Australians quicker. Given the Cabinet has not rejected new medicines for listing, it is also hard to see how increasing the threshold will cost the Government any money.”

Currently, any new medicine that is being considered for listing on the PBS that is expected to cost more than $10 million in any one year needs to be approved by Federal Cabinet before it can be listed.

In its submission to the Committee, Medicines Australia argued that the threshold should be doubled from $10 million to $20 million and indexed.

The Committee also recommended a range of measures to improve the process and transparency around creating therapeutic groups.

“The recommendations to improve the process of creating therapeutic groups will also help improve the PBS processes for patients, industry and the Government.”

The Senate Community Affairs Committee report released last night, Consumer Access to Pharmaceutical Benefits, can be found here

Medicines Australia’ submission to the inquiry can be found here

For media, contact Brendan Shaw on 0413 013 501


Contact Person:

Brendan Shaw
Chief Executive
Phone: 0413 013 501